Linkfest: Central banks warn of bubbles; ‘Smart beta’ and quant strategies over-hyped? An M&A boom

Categories: Linkfest

Today’s most shared:

  • Central bankers fear easy money is creating new bubbles without healing damage from previous bubbles and financial crisis.
  • ‘Smart beta’ and other quantitative strategies sometimes tout paper-trading track records as if they were real historical returns, with verbiage like “100% historical probability of outperformance.” It’s all too easy to construct weird strategies with great historical performance.
  • BNP board approves settlement, including 2015 dollar-clearing ban.
  • M&A boom in first 6 months of 2014, highest since 2014.
  • Mild opposition to concentrated wealth and power arouses disproportionate acrimony from some thin-skinned targets.
  • Natural experiment suggests tax cuts don’t actually solve all ills.
  • Onslaught of data in holiday-shortened week.
  • Facebook experiments with making news feeds happier, making some unhappy. Is it OK to tweak what you see to make you more addicted, connected, and click on more ads, but not to test the impact of sentiment filtering?

Central Bankers Issue Strong Warning on Asset Bubbles
New York Times
In its annual report, the Bank for International Settlements expressed concern about investors driving up asset prices with little regard for the risks.
shared by @anatadmati, @nancefinance, reddit/Economics, @ryanchittum
Huge Returns at Low Risk? Not So Fast
Wall Street Journal
Let me guess. You are sick and tired of earning nothing on your bonds and cash, and the stock market still scares you.
shared by @derekhernquist, @cullenroche, @ReformedBroker, @RPSeawright
BNP Paribas Dollar-Clearing Ban Said to Start in 2015
BNP Paribas SA won a reprieve during final talks to settle a criminal probe into U.S. sanctions violations, giving the bank six months to prepare for a ban on handling certain dollar transactions.
shared by Business Insider, @Alea_, Here Is The City, @Ian_Fraser
Weighing the Week Ahead: Economic Fireworks?
With the stunning decline in Q1 GDP, the health of the US economy has once again taken center stage. The week ahead is shortened by a Friday holiday, but is packed with important data releases.
shared by Abnormal Returns, @ReformedBroker, Crossing Wall Street
James Gorman of Morgan Stanley, Going Against Type
New York Times
Forgoing Wall Street flash, Morgan Stanley’s chief executive is finding safer ways for the firm to make money.
shared by @LaurenLaCapra, @MattGoldstein26, @LaurenYoung, Here Is The City
Value of M&A hits $1.7tn in first six months of 2014
Financial Times
Deal frenzy, animal spirits, merger mania – call it what you like, it is back. The value of global mergers and acquisitions hit $1.75tn in the first six months of the year, a 75 per cent rise on the same period last year and the highest since 2007.
shared by Business Insider, @MParekh, @FGoria, @HamzeiAnalytics
Blackstone Readies Big-Bet Hedge Fund
Wall Street Journal
Blackstone is quietly laying plans to start a hedge fund that will make big, bold bets, an effort it hopes will eventually rival some of the largest firms in the business.
shared by @mark_dow, @MParekh, @moorehn, @JacobWolinsky, Business Insider
Why Are the Super-Rich So Angry?
New Yorker
Stephen Schwarzman, Tom Perkins, and other billionaires have recently ranted against the poor and middle class. The well-being of the American middle class just doesn’t matter as much to companies’ bottom lines. Moguls complain about their feelings because that’s all anyone can really threaten.
shared by @ObsoleteDogma, @MarkThoma, @kevinroose, @EpicureanDeal
Charlatans, Cranks and Kansas
New York Times
The state’s economy is in terrible shape after huge income-tax cuts — another case of big money selling bad ideas.
shared by @interfluidity, reddit/Economics, @rjocean, @Pawelmorski, @NKingofDC
Let Them Eat Cash
New York Times
Help the poor by giving them money. They won’t waste it.
shared by @JustinWolfers, @cafreeland, reddit/Economics, @ModeledBehavior
Facebook Tinkers With Users’ Emotions in News Feed Experiment, Stirring Outcry
New York Times
Last week Facebook revealed that it had manipulated the news feeds of over half a million randomly selected users to change the number of positive and negative posts they saw.
shared by @JeffMacke, @davewiner, @nancefinance, Crossing Wall Street
Are Markets Efficient? Even the Supreme Court Is Weighing In
New York Times
In a case that delved into a much-debated academic theory, a ruling erects a new hurdle for investors to clear in some class-action lawsuits.
shared by @TonyTassell, @EddyElfenbein, @MarkThoma, reddit/Economics, @MichaelKitces
Stash Pad
New York
The New York real-estate market is now the premier destination for wealthy foreigners with rubles, yuan, and dollars to hide.
shared by @davewiner, @EpicureanDeal, @prchovanec, @mccarthyryanj follows the best ‘curators’ on the web and social media, and finds all the top financial news right now, as voted by you.

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